Hi! I've been trading for my own account about 9-10 years now. Moderately successful at best but I've come out profitable consistently. I'm especially interested nowadays in dividend stocks as a method of generating passive income. Any thoughts?
RE: Experienced Stock Trader
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Experienced Stock Trader
Dividends might be the easiest way to generate income. After 9-10 years, have you really not gotten involved in them? My favorites are REITs (Real Estate Investment Trusts). They are a type of organization that invests in properties and legally must pay 90% of its profits as dividends. Most of the time, the C-suite managers own quite a few shares. The one I trade the most is NYMT, which focuses on property in NY. It has paid a 15-20% dividend each year for at least the past four years I've been trading them, and the stock price bounces between $5-$7 all the time. Buy at $5, collect dividends, and sell at $7. All the while collecting 15%.
If that sounds too risky, VNQ is the ETF that deals in REITs. They are a very safe investment that will always pay between 3-4%.
What's your strategy?
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I have an account that follows a strategy similar to the classic "dividend aristocrats" - mainly consumer staples and industrial conglomerates. Yield is only around 3% although given recent sector rotation the capital gains have been quite good. Interesting point about REITs - I didn't realize yields were so high for some. My last hunt for yield got me into energy MLPs which didn't turn out so well . . .
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Yeah that's too bad, especially if they are energy MLPs. I hope you weren't involved in that- could have gotten crushed!
I'm not too familiar with dividend aristocrats. It sounds like the type of blue-chip stock that you invest in for the long-haul. I'm in for a while myself, but being only 25, I can accept more risk to see some real rewards. I've recently gotten into options trading. I am a big fan of covered-calls and cash-covered puts. VERY low risk way to trade. Are you into that at all?
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